A framework has been launched for the implementation of a reciprocal trade agreement between the US and Thailand, marking a major trade package in which Thailand will purchase US agricultural and energy products, and aircraft, valued at more than US$20 billion According to a document published by the White House on Sunday (26 Oct), the US and Thailand have agreed to develop a framework for an Agreement on Reciprocal Trade in order to reinforce bilateral economic relations, which will enable exporters from both countries to access each other’s markets as never before.
This Agreement on Reciprocal Trade is built on the long-standing economic relationship between the two countries, including the 1966 treaty on amity and economic relations between the US and Thailand and the US-Thailand Trade and Investment Framework Agreement signed in 2002.
Key conditions of the US–Thailand Agreement on Reciprocal Trade include:
Thailand will eliminate tariff restrictions on approximately 99 per cent of goods, covering US industrial, food and agricultural products. The US will maintain a retaliatory tariff rate of 19 per cent pursuant to Executive Order 14257 dated 2 April 2025 for goods originating from Thailand, and will grant a 0 per cent rate for products specified in Annex III of Executive Order 14346 dated 5 September 2025 concerning possible tariffs on partner countries. The US and Thailand will collaborate to remove Thai non-tariff trade barriers affecting bilateral trade, including Thailand’s commitments to facilitate US-made vehicle imports meeting US federal safety and emissions standards, to accept certifications from the Food and Drug Administration (US FDA), to open markets for US medical devices and pharmaceutical products sufficient to meet Thai demand, to licence US ethanol imports for use as fuel, to amend customs laws to eliminate bounty-scheme rewards linked to infringement and customs penalties, and to adopt and adhere to good regulatory practices. Thailand will address and prevent trade barriers for US food and agricultural products in the Thai market, including accelerating access for US meat and poultry products certified by the Food Safety and Inspection Service (FSIS), and ensuring requirements imposed on US agricultural products (including distiller’s dried grains with solubles from US corn) are science- and risk-based; Thailand commits to accept US regulatory agency certificates under existing arrangements. The US and Thailand will finalise commitments concerning internationally recognised labour-rights protections, including amending legislation to ensure workers’ freedom of association and collective bargaining rights are fully protected, strengthening labour-law enforcement, and addressing violations in high-risk sectors such as forced labour and child labour. Thailand commits to implement and uphold high-level environmental protection measures, effectively enforce environmental laws, combat trade in timber and forest-risk products sourced from illegal deforestation, promote more resource-efficient economies, fully implement the World Trade Organization (WTO) Agreement on Fisheries Subsidies, combat illegal, unreported and unregulated fishing, and combat illegal wildlife trade. The US and Thailand will finalise commitments relating to intellectual-property rights (IPR), including geographical indications. Thailand undertakes to address long-standing IPR issues, strengthen enforcement against trademark counterfeiting and copyright infringement, prevent circumvention of technological protection measures, and resolve outstanding patent-registration issues.
The US and Thailand will finalise an agreement under which Thailand will resolve barriers affecting trade, services and digital investment; Thailand pledges to forego digital-services taxes or discriminatory measures against US digital services or digital products, ensure free-flow of cross-border data transfers for business operations, support in the WTO the permanent elimination of customs duties on electronic transmissions, refrain from imposing quotas on film-projection rights, relax foreign-ownership restrictions for US investment in Thailand’s telecommunications sector, and eliminate domestic-processing requirements for all consumer-electronic-payment-card transactions issued in Thailand. The US and Thailand will finalise commitments to address distortive behaviour by state-owned enterprises (SOEs). They will strengthen cooperation on economic and national-security matters to enhance supply-chain resilience and innovation through mutually supportive action, address unfair trading practices by third parties, and cooperate on export controls, investment security and tax-evasion countermeasures. In addition, the US and Thailand acknowledged trade deals to be entered into between US and Thai companies in the agriculture, energy and aviation sectors, including:
procurement of US agricultural products – namely US corn for feed, US soybean meal and distiller’s dried grains with solubles – amounting to approximately US$2.6 billion per annum. procurement of US energy products – namely liquefied natural gas (LNG), crude oil and ethane – amounting to approximately US$5.4 billion per annum. procurement of US-manufactured aircraft – 80 units valued at approximately US$18.8 billion. In the coming weeks, the US and Thailand will negotiate and finalise the Agreement on Reciprocal Trade, prepare for its signing and conduct domestic commemorative procedures before the agreement enters into force.
Source : The Nation |
